€700 million a year given to private landlords.

garhjw

nostro wrote: »

Social housing worked for generations. An ideological decision was made by FG to effectively end it. Now we have the intended consequences of that policy.
A "housing crisis" homelessness, vast sums of money being transferred to private landlords and hotels, skyrocketing rents for low paid workers.
This was all very foreseeable and is intended.
And although there are losers there are a lot of people that have become very wealthy from this policy.
The charity industries, the institution investors, REITS who buy up blocks of apartments on the promise of the HAP millions.

Decisions on social housing were made long before FG got into government.

Magnatu

garhjw wrote: »

Decisions on social housing were made long before FG got into government.

When did FG get into government?


In 1975, local authorities built 8,794 social housing units,

In 2007, the local authorities built 4,986 homes. This number fell to 4,905 in 2008.

Then there was a drop to 3,362 in 2009 and another decrease of 2,000 units to 1,328 in 2010.

There were just 486 units built in 2011, 363 houses in 2012, 293 in 2013, 158 in 2014, and just 75 in 2015.

Be aware as well that the policy to stop providing social housing coincided with the state getting significant numbers of housing units through NAMA.

They gave these away for half nothing to vulture funds and developers and instead began dramatically increasing state transfers to private landlords.

HAP payments to landlords have increased by €276,600,000 a year under FG.

This was an ideological policy.

garhjw

Magnatu wrote: »

When did FG get into government?


In 1975, local authorities built 8,794 social housing units,

In 2007, the local authorities built 4,986 homes. This number fell to 4,905 in 2008.

Then there was a drop to 3,362 in 2009 and another decrease of 2,000 units to 1,328 in 2010.

There were just 486 units built in 2011, 363 houses in 2012, 293 in 2013, 158 in 2014, and just 75 in 2015.

Be aware as well that the policy to stop providing social housing coincided with the state getting significant numbers of housing units through NAMA.

They gave these away for half nothing to vulture funds and developers and instead began dramatically increasing state transfers to private landlords.

HAP payments to landlords have increased by €276,600,000 a year under FG.

This was an ideological policy.

So the decline in the number of houses built had started well before FG got into government.

antoinolachtnai

Maybe they stopped building because there were a lot of spare housing and they needed the money to keep hospitals open in the depths of a recession?

The government at that point had advice that there was plenty of housing and that would there would be a surplus for years.

Magnatu

antoinolachtnai wrote: »

Maybe they stopped building because there were a lot of spare housing and they needed the money to keep hospitals open in the depths of a recession?

The government at that point had advice that there was plenty of housing and that would there would be a surplus for years.

You are completely missing the point. It was ideological.
There were large numbers of empty houses and NAMA had significant stocks which it offered to the government for social housing. FG rejected the offer.
They decided to stop providing social housing at the exact time that tens of thousands of housing units were available to them. Instead they started to dramatically and significantly increase financial transfers to private landlords.

This policy only makes any sense if you understand the ideological basis for it.
Which they are resisting changing despite enormous pressure.

The_Conductor

It is hard to justify spending 700m a year on private sector housing- given how constrained our finances are (even now).
This 700m though- is being forced on the private housing sector- when the actual issue is a lack of supply (across the board in both the rental and all other residential property sectors).
We need to build more homes- we need to revisit our social housing obligations (in light of the fact that we are now being forced to enumerate the expenditure as part of government expenditure)- and we need to get over our hangup with building local authority and council estates- and get them up and running- and people out of private rental accommodation and into social housing units.
If this means private rental units are vacant- rents will fall- which will benefit all tenants- until such a stage as a new equilibrium is met- or the landlord sells the unit.

The current situation is farcical- however, its a situation of the government's making- and not one that suits tenants or landlords- both of whom hate it.

The_Conductor

Magnatu wrote: »

You are completely missing the point. It was ideological.
There were large numbers of empty houses and NAMA had significant stocks which it offered to the government for social housing. FG rejected the offer.
They decided to stop providing social housing at the exact time that tens of thousands of housing units were available to them. Instead they started to dramatically and significantly increase financial transfers to private landlords.

This policy only makes any sense if you understand the ideological basis for it.
Which they are resisting changing despite enormous pressure.

The large numbers of empty houses were based on the premise of the census denoting properties as vacant at census time. A list of addresses were forwarded to the local authority for investigation by the CSO (on the instruction of the Minister)- which when investigated in DCC (for example) showed a total of fewer than 12% of those properties denoted by the CSO as vacant residential units- to be vacant. There was much discourse as to why people would pretend their homes were vacant- and a myriad of reasons put forward- however, the fact of the matter is- those tens of thousands of vacant units that the government were certain are out there- actually aren't.

NAMA had a limited supply of residential housing units in Ireland (it had over a hundred thousand in the UK)- most of its property in Ireland was actually commercial in nature. It did have a number of 'ghost estates' and other developments that were partially or wholly undeveloped. I think the figure I heard bandied around was 4 billion- that NAMA spent to bring any viable developments to the market. Keep in mind- its remit was to sell off its loans (and it owned the loans not the property in lien on the loans)- to the highest bidders. It has been a reasonable success as an organisation (though it was difficult not to be a success when they only paid an average of 48c on the Euro for the loans they took charge of).

There was a vast glut of property available out there in the noughties- that could in theory have been bought up by the government for social housing units (when we had the money to pay for it). Instead we flustered around with the ideas of grandiose projects- such as the Bertie Bowl and other vanity expenditure. However- from the time of plenty- we ground to more or less a halt- and the natural rate of increase in our households- has mopped up the excess supply, as it then was.

The only solution to the issue- is a massive increase in supply- sufficient to dampen pent up demand- and then an ongoing social housing development strategy- which has to include a complete halt to selling social housing units- forever.

Supply though- is the knux to cracking this problem. The transfer of 700m per annum to the private rental sector- is not the fault of landlords (many of whom are voting with their feet and exiting the sector altogether). It is the fault of an incoherent government policy that simultaneously allowed local authorities sell off their housing stocks- while simultaneously no replacements came on board.

Wheeliebin30

nostro wrote: »

Social housing worked for generations. An ideological decision was made by FG to effectively end it. Now we have the intended consequences of that policy.
A "housing crisis" homelessness, vast sums of money being transferred to private landlords and hotels, skyrocketing rents for low paid workers.
This was all very foreseeable and is intended.
And although there are losers there are a lot of people that have become very wealthy from this policy.
The charity industries, the institution investors, REITS who buy up blocks of apartments on the promise of the HAP millions.

That’s a lie.

FF made the decision to stop building it.

FG took over and last year the most social houses were built in the last decade.

So what you posted is complete bull****.

Wheeliebin30

Magnatu wrote: »

You are completely missing the point. It was ideological.
There were large numbers of empty houses and NAMA had significant stocks which it offered to the government for social housing. FG rejected the offer.
They decided to stop providing social housing at the exact time that tens of thousands of housing units were available to them. Instead they started to dramatically and significantly increase financial transfers to private landlords.

This policy only makes any sense if you understand the ideological basis for it.
Which they are resisting changing despite enormous pressure.

Anything to say about the 4,500 social houses built last year by FG?

Or does your waffle facts just take into account up to 2015 and nothing after that.

GGTrek

Magnatu wrote: »

Ah. So ye don't really want the €700 million..

I don't want anything from the Irish govvie, the govvie and most of the TDs are my sworn enemies. I just want them to leave me in peace, stop issuing very damaging legislation almost every year and with the tax money they pocket from landlords (indirectly from tenants) they can build plenty social housing (which they don't want to do, since it takes a lot of time and effort, SF are the worst hypocrites, since wherever they are in power they do f...k all!). BTW almost half of that money goes straight back into the govvie coffers after a few months. Have you ever thought about that?



I do not want the govvie welfare tenants, most of them represent a huge potential credit risk (since they have nothing to loose) and the vast majority of worst stories of overholding and non payment of rent come from this class of tenants. Mind you they also screw councils, the rent arrears on the tiny council houses rents are mind boggling.


The real issue in a first world country is the one of balancing crime rates vs providing free stuff to people who have no skills to work (or no willingness to work). In third world countries the solution is real quick, all these people with no skills and no work are dispatched straight into the streets, they live like animals in shanty towns, but on the other side the crime rates are massive (security is a massive concern).


This forum is not the typical sold out socialist Irish medial outlet, here (as you might have well noticed) your will get real push back on stupid socialist "easy" propaganda issued by the SF hypocrites.

antoinolachtnai

The_Conductor wrote: »

The large numbers of empty houses were based on the premise of the census denoting properties as vacant at census time. A list of addresses were forwarded to the local authority for investigation by the CSO (on the instruction of the Minister)- which when investigated in DCC (for example) showed a total of fewer than 12% of those properties denoted by the CSO as vacant residential units- to be vacant.

You are alleging that the last census is completely incorrect and that there are hundreds of thousands more people in the country than were counted (living in the houses counted as vacant).

Can you provide any evidence for any of the statements above? Because I don’t remember any massive restatement of CSO results. (I don’t remember any law being passed allowing ministers to demand census data either.)

boege

I did some quick calculations on what it would cost government to displace all these HAP payments. Take an average rent of average property price of around €350k and an interest rate of 4% and you get €630m, give or take. There is no tax return on this to government as would apply to landlords HAP income.

What most people overlook is that the landlord absorbs the overhead of rental property management. Landlords cannot cost their own time into your tax returns. I suspect Government has outsourced social housing to the private sector as its simply cheaper.

There is also the not insignificant fact that we still have a large government debt and that a large scale social housing programme will increase that debt. More than likely this will increase the interest rate paid on all of the dept. I do have a sneaking suspicion that the government is still limited (by Troika members) in its capacity to borrow for major capital programmes. My understanding is that Ireland is still in an EU debt surveillance programme on debt repayment. Politicians don't like to admit that they are not really in control.

antoinolachtnai

Private housing is a pretty cheap way to provide social housing when you take into account the tax it generates and the level of service it provides. In general private housing is required to meet much higher standards than public provided housing.

The government is subject to borrowing restriction the same as all other member states.

This Isnt the whole story though. Most countries manage to borrow off balance sheet for social housing. They do this by arranging for social housing to be owned and operated by housing associations. The local authorities have not succeeded in figuring out how to do this.

El Tarangu

Magnatu wrote: »

Suppose you stopped the €700 million in annual transfers in the morning what would happen. Rents would collapse.

There would be a downward pressure on rents. But I'd say there would still be enough demand (in Dublin) for them not to fall too far; what would happen is that renting in Dublin would become unaffordable overnight for anyone reliant on a social welfare payment. And while I can actually see some merit in this idea (I don't see the benefit of subsidising people who don't need to be in Dublin for work to live there; people on SW could move to better accommodation in parts of the country where there isn't a housing crisis, and where their limited income would go further), I doubt that this would be the outcome that you intended.

sk8board

boege wrote: »

........ I suspect Government has outsourced social housing to the private sector as its simply cheaper.

As a full time LL, I can assure you this was the case in 2012 when the decision to defacto outsource was made and is still the case now. It honestly was probably the right decision at the time - there was a very ‘motivated’ private rental market - 23,000 properties to rent on daft in 2012 and LLs were being chased by nationalised banks.
Now there’s 3000 places to rent, rents are at an all time high, but the market is broken and accidental LLs are selling, especially now that capital returns are most likely topping out.

- People can give out about REITs, but the reality is that the market needs to professionalise if it’s to be held to any standards.
- Accidental LLs need to be replaced, not removed
- Allow LLs to establish companies rather than the current situation of rental income being treated as PAYE income, like it was some sort of Christmas bonus we’ve earned. unfortunately that bonus has a load of costs

It’s a broken market for all sides.

overkill602

Great headline for attracting an emotive and populist agenda SF does not propose solutions just publicity where and when ever.
To deliberately suggest a transfer of state money to greedy LLs with nothing in return is a great waste of money bit like your own unvouched expenses and generous pensions totally out of line with reality and a luxury LLs cannot have.

Simple as the state cannot borrow to build so the provision of mandatory social housing on private LLs is the cheaper options and the councils are loving it zero risk and given their total failure and mismanagement by selling off cheap, allowing 100s million in arrears, no space utilisation single occupant in 3 beds.
It still a drop in the ocean where the waste really is but there no votes in that one

marieholmfan

pwurple wrote: »

Indeed. So, Working people should provide their goods and services for free, and never be paid at all at all...? Is that what they want?

Or, government provided slums.

Both cool options.

Landlords are not working people (even if they work) landlords are by definition rentiers.
Don't feel bad about not knowing this.

Magnatu wrote: »

Ah. So ye don't really want the €700 million..

In fairness in much of the country (and probably most of the market) landlords try to avoid tenants whose rent is paid by the state. A landlord is obliged to accept such tenants.
There is a perception that such tenants are more likely that those who are paying their own rent to default and also that in default the landlord won't be able to recover.
Also there is a danger that the house that the landlord is trying to rent out will be found substandard by the county council.

I am sure that in Kerry, Donegal etc. landlords are happy to take HAP.

sk8board

marieholmfan wrote: »

There is a perception that such tenants are more likely that those who are paying their own rent to default and also that in default the landlord won't be able to recover.

I currently take HAP, and that’s not really the big risk - it’s the council themselves.
e.g I get €1100 from the council and €200 from the tenant. If the tenant is late paying the €200, or stops, the council automatically stop paying their portion and throw me to RTB to resolve our differences. They just want people under roofs, and then abdicate all responsibility.

Why not e.g continue to pay the 1100 for 3 months after the tenant stops paying to try get things back in order. Anything would help really

JJJackal

Its worth noting that from the 700 million, the government probably get close to 350 million back on tax or PRSI or USC or whatever taxes companies pay.

The 350 million "profit" the landlords make is then reinvested (i.e paying back mortgage to banks which could be partially owned by the government eg AIB - thus making profit for government) or spent in the local economy.

The government is not responsible for maintaining these properties

beauf

Magnatu wrote: »

An accusation levelled against Fine Gael many times over the years was that the housing crisis was deliberately and cynically manufactured in order to allow them to justify the massive transfer of taxpayer money to the already wealthy. The investment funds, the pension funds, the landlords.

Figures obtained by Sinn Féin’s Eoin Ó Broin show that in total, €695,346,000 was given to private landlords in 2018.

“This is a massive transfer of public money to private landlords,” said Ó Broin.

Another intended consequence of this ideologicaly driven wealth transfer is spiraling rents. At the same time as these massive sums are being paid annually no affordable homes and tiny numbers of social homes are being provided.

The bigger picture....

The reduction of social housing built by Local Authorities started in the 80s.
They switched to outsourcing it to the private sector as a cost cutting measure.
Private Market didn't want it, and had to be forced to accept it.

This was something that happened in many European countries and it has resulted in a housing crisis in most countries that did it. Then it was compounded by credit bubbles and boom and bust economic policies.

Both FG and FF have poured fuel on these fire, repeatedly.
The opposition sat on their hands while on over watch.

Magnatu

sk8board wrote: »

I currently take HAP,
e.g I get €1100 from the council and €200 from the tenant.

So the govt artificially sets the floor for rent in that area at €1300 a month. No landlord needs to less than that. This is beyond the reach of many workers who have to house share or relocate because HAP policy has priced them out of the rental market. Low paid workers are the real losers from this policy.

Graham

The market sets the rent for the area.

There's little point setting the HAP limits at €800 if the going rate is €1300.

marieholmfan

Magnatu wrote: »

Low paid workers are the real losers from this policy.

Very true. Council houses/ flats should be made available to everyone who wants one.
Many people would still buy houses.

The fault for a governmental failure to build council houses for 30 years cannot be laid at this generation of landlords.
Given the voting habits of the Irish poor the fault probably lies much closer to home.

Magnatu

Graham wrote: »

The market sets the rent for the area.

There's little point setting the HAP limits at €800 if the going rate is €1300.

No it doesn't. Manipulation of the market using HAP has increased rents significant. There is no doubt that rents would be significantly lower without it. So rents for those renting privately are a lot higher than they should be because of govt interference in the private rental market.

Of course there are those that maintain that this is one of the main goals of HAP.

Graham

HAP usualy trails the market.

an_fathach

nostro wrote: »

Social housing worked for generations. An ideological decision was made by FG to effectively end it. Now we have the intended consequences of that policy.
A "housing crisis" homelessness, vast sums of money being transferred to private landlords and hotels, skyrocketing rents for low paid workers.
This was all very foreseeable and is intended.
And although there are losers there are a lot of people that have become very wealthy from this policy.
The charity industries, the institution investors, REITS who buy up blocks of apartments on the promise of the HAP millions.

It didnt though.
Many social housing estates were diasters and it was always crippling expensive.

marieholmfan

Magnatu wrote: »

No it doesn't. Manipulation of the market using HAP has increased rents significant. There is no doubt that rents would be significantly lower without it. So rents for those renting privately are a lot higher than they should be because of govt interference in the private rental market.

Of course there are those that maintain that this is one of the main goals of HAP.

Why is there no doubt about that?

amcalester

marieholmfan wrote: »

Why is there no doubt about that?

It's a bizarre claim considering regulations had to be introduced to stop rents spiraling further out of control.

Eric Cartman

Graham wrote: »

The market sets the rent for the area.

There's little point setting the HAP limits at €800 if the going rate is €1300.

Because landlords can't officially decline HAP, when you set HAP to 800, the rent in an area then automatically becomes 900.

The trick SF missed is , 700 million paid to landlords equals atleast 350 million coming right back into the state coffers in tax

theres 23,506 active HAP tenancies according to focus ireland in may 2018 which breaks down to average 14,889 per tenancy per year it costs the government, little over 1k a month, not bad considering some of it goes to renting out 4 bed detached houses for larger families.

Graham

Which bit of legislation limits market rent to HAP + €100?